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Property Assessment Limits

Effects on Homestead Property Tax Burdens and National Property Tax Rankings

Aaron Twait

Abril 2012, inglés

Property tax assessment limitations deliver different levels of tax relief to different parcels; based largely on the owner’s tenure and the parcel’s change in value over time relative to the assessment limit. These parcel-specific assessment limits have implications for the findings of the Minnesota Taxpayers Association’s 50-State Property Tax Comparison Study, which compares tax burdens on hypothetical properties of similar value in different cities. This research explores issues related to the development and application of a methodology to incorporate these effects into the 50-State Property Tax Study. We conclude that we can develop a reasonably robust methodology to incorporate these effects. We conclude that rapid market appreciation combined with relatively stringent limitations exempted between 40% and 65% of residential property value for an “average” homeowner in selected locations in payable 2006. We conclude that revaluation practices should also be included in MTA’s 50-State Property Tax Study since periodic or ad hoc revaluations function as de facto assessment limitations.